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REPORT OF THE PRIORITY ISSUES OF THE EIGHTEENTH SUMMIT OF THE 18th COMESA AUTHORITY OF THE HEADS OF STATE AND GOVERNMENTS ADDIS ABABA, FEDERAL REPUBLIC OF ETHIOPIA, 30 – 31 MARCH 2015 THEME: “INCLUSIVE AND SUSTAINABLE INDUSTRIALISATION”
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COMOROS
REPORT OF THE PRIORITY ISSUESOF THE EIGHTEENTH SUMMIT OF THE 18th COMESA AUTHORITY OF THE HEADS OF STATE AND GOVERNMENTS
ADDIS ABABA, FEDERAL REPUBLIC OF ETHIOPIA, 30 – 31 MARCH 2015
THEME: “INCLUSIVE AND SUSTAINABLE INDUSTRIALISATION”
REPORT OF THE PRIORITY ISSUES
OF THE EIGHTEENTH SUMMIT OF THE 18th COMESA AUTHORITY OF THE HEADS OF STATE AND GOVERNMENTS
REPORT OF THE PRIORITY ISSUES
OF THE EIGHTEENTH SUMMIT OF THE 18th COMESA AUTHORITY OF THE HEADS OF STATE AND GOVERNMENTS
THEME: “INCLUSIVE AND SUSTAINABLE INDUSTRIALISATION”
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ACRONYMS 1
THE COMESA CUSTOMS UNION 3
THE COMESA FREE TRADE AREA (FTA) 3
TRADE IN SERVICES 4
PROTECTION FOR KENYA SUGAR INDUSTRY 5
SCIENCE, TECHNOLOGY AND INNOVATION 6
CO-OPERATION AMONG MEMBER STATES IN THE MANUFACTURING OF ESSENTIAL DRUGS; AND AMENDMENT OF THE RIPS AGREEMENT ON
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COMESA INDUSTRIAL POLICY 15
AGRICULTURE 16
CLIMATE CHANGE PROGRAMME 19
GENDER 19
STATUS OF SIGNATURE, RATIFICATION AND DOMESTICATION OF COMESA LEGAL INSTRUMENTS
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STATUS OF FINANCING OF COMESA PROGRAMMES 21
PROGRESS REPORTS OF THE COMESA INSTITUTIONS 23
CONTENTS
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ACRONYMS
ACTESA Alliance for Commodity Trade in Eastern and Southern Africa
AFAP Agribusiness Partnership Contracts
AFCAC/IATA African Civil Aviation Commission/ International Air Transport Association
AID Africa Infrastructure Database
APCs Agri-business Partnership Contracts
ATI African Trade Insurance
AU HQ African Union Headquarters
AU African Union
CAADP Comprehensive Africa Agriculture Development Programme
CBC COMESA Business Council
CBC COMESA Business Council
CCC COMESA Competition Commission
CCC COMESA Competition Commission
CET Common External tariff
CIF COMESA Infrastructure Fund
CMR Customs Management Regulations
CNS/ATM Communications Navigation Surveillance/Air Traffic Management Systems
COMESA-URI COMESA University of Regional integration
CSA Climate Smart Agriculture
CTC Competition and Tariff Commission
CTN Common Tariff Nomenclature
DFAT Department of Foreign Affairs and Trade
ECOWAS Economic Community of West African States
EU – AU European Union – African Union
FDI Foreign Direct Investment
FDI Foreign Direct Investment
FDI Foreign Direct Investments
FEMCOM Federation of Women in Business in Eastern and Southern Africa
FiT Feed-in-Tariffs Guidelines
FTA Free Trade Area
ICF Investment Climate Facility
IITA International Institute of Tropical Agriculture
IS&R Implementation Strategy and Roadmap
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2 ITC International Trade Centre
JFPI Joint Fertilizer Procurement Initiative
LAPSSET Lamu South Sudan and Ethiopia Transport Corridor
LLPI Leather and Leather Products Institute
LLPI Leather and Leather Products Institute
NAIPs National Agriculture Investment Plans
NCCRS National Climate Change Response Strategies
PIDA Programme for Infrastructure Development in Africa
PKI Public Key Infrastructure
PPA Power Purchase Agreement
PPP Public Private Partnerships
PPP Public Private Partnership
PTA Preference Trade Area
RECs Regional Economic Communities
RIP Regional Indicative Programme
SMEs Small and Medium Enterprises
TLC Total Land Care
TRIPDA Tripartite Regional Infrastructure Projects Database
TRIPS Agreement on Trade-Related Aspects of Intellectual Property Rights
UNCTAD United Nations Conference on Trade and Development
UNFCCC United Nations Framework Convention on Climate Change
USAID United States Agency for International Development
VICMED Victoria - Mediterranean Sea Navigation
WTO World Trade Organisation
YD Yamoussoukro Decision
ZEP-Re COMESA Re-Insurance Company
In line with Article 8(2) of the COMESA Treaty which provides that: “The Authority shall be the supreme Policy Organ of the Common market and shall be responsible for the general policy and direction and control of the performance of the executive functions of the Common Market and the achievement of its aims and objectives and shall have such powers as are vested in it under this Treaty,” the 18th Summit of the COMESA Authority set the following priorities for the year 2015/2016:
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A. THE COMESA CUSTOMS UNION
1. The Authority recalled that that owing to challenges in the key elements of the Customs Union,
full implementation of the Customs Union had been deferred pending the resolution of the
initial challenges to its implementation.
2. In this regard, the Authority noted the following progress that had been made towards the full
implementation of the COMESA Customs union:
(a) The Heads of Customs Sub-committee was established and it held its inaugural meeting
on 5 – 6 February 2015 in Nairobi, Kenya and that a three year work program for the
Sub-Committee was adopted;
(b) Member States are implementing more than 95% of the Customs Management
Regulations (CMR); 15 Member States are implementing the Common Tariff
Nomenclature (CTN) and 9 Member States are ready implement the Common External
Tariff (CET); and
(c) That Council has re-affirmed the application of the principle of variable geometry to the
Customs Union, in accordance with previous decisions of Council.
B. THE COMESA FREE TRADE AREA (FTA)
3. The Authority recalled that fourteen (14) Member States were participating in the FTA whilst
another four (4) Member States were trading on preferential terms and had submitted their
reviewed schedules and the Member States incorporated the comments into their final
schedules.
4. With Regards to the status of preparation for joining the COMESA FTA by Congo DR, Ethiopia,
Eritrea and Uganda, the Authority noted that:
(a) Uganda had formally joined the FTA and has been implementing the FTA since July
2014;
(b) DR Congo reiterated its commitment to joining the FTA albeit on a phased approach;
with 40% tariff reduction upon joining, 30% in the second year and 30% on the third
and final year. The country was waiting for adoption by its Parliament of the law for the
country to join the FTA;
(c) Ethiopiahas had started internal consultations and preparation of the accession
instruments to participate in the FTA on a phased approach basis. Ethiopia needed the
enhancement of its capacity on rules of origin which is critically important for the FTA
to be built. In this regard continuous capacity building on the COMESA rules of origin
will be undertaken by the Secretariat; and
(d) Eritrea had, since 1998, reduced tariffs for trade with COMESA countries by 80% and is
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4 only left with 20% tariff reduction to move to the FTA. Eritrea had further re-affirmed
its commitment to join the FTA, and the Member State is working closely with the
Secretariat to build capacity to enable the Member State expeditiously join the FTA.
5. The Authority endorsed the decisions of Council that:
i. CongoDRbeurgedtofinalisetheaccessioninstrumentsanddepositthemwiththe
SecretariatbeforethenextPolicyOrgansmeetings;
ii. Ethiopiabeurgedtoexpeditetheinternalconsultationsandfinaliseinstrumentsand
depositthemwiththeSecretariat,inthenearfuture;
iii. Ugandabeurgedtoprepareapaperandascheduleforphasingoutthesensitive
products;
iv. UgandabecommendedforbeginningtoimplementtheFTAandsubmittingthe
AccessionInstruments;and
v. EritreabeurgedtoexpediteitsprocessofjoiningtheFTA.
C. TRADE IN SERVICES
6. The Authority recalled that the Regulations on Trade in Services had been adopted and
that Member States were in the process of identifying priority sectors for negotiation. The
Authority is further invited to recall the importance of services in facilitating trade and value
addition and that trade in services contributes up to 60%of GDP.
7. The Authority noted that substantive negotiations on the schedules of specific commitments
in the four priority sectors of transport, communication, financial and tourism services had
been completed and that Member States had been requested to ensure that their schedules
complied with international scheduling standards of the WTO and that the following Member
States had submitted their reviewed schedules taking into account the comments provided by
the WTO: Burundi, Djibouti, Kenya, Mauritius, Sudan, Egypt, D R Congo, Uganda, Swaziland,
Malawi, Zambia and Seychelles.
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8. The Authority also noted that the Secretariat had embarked on a comprehensive study on
three additional priority sectors of energy, business services and construction and related
engineering services and that after completion of the studies the second round of negotiations
in the three additional priority sectors would commence in July 2015.
9. The Authority endorsed the decisions made by Council as follows:
i. MemberStatesthathadnotsubmittedtheirrevisedschedulesofspecificcommitments
inthefourprioritysectorsoftransport,communications,financialandtourismshould
dosoby30June2015;
ii. ThecommitmentsmadebyMemberStatesshouldaddvalueandthereforebeWTO
plus;
iii. TheSecretariatshouldcirculatethesubmittedfinalisedSchedulestoallMemberStates
by30April2015;
iv. ThesecondroundofnegotiationsinthethreeadditionalprioritysectorsofBusiness
services,EnergyservicesandConstructionandRelatedEngineeringservicescommence
inJuly2015;and
v. ToensurethatthecommitmentsofMemberStatesinthethreesectorsgobeyond
theirWTOcommitmentsinordertoaddvalue,abaselinestudyshouldbeundertaken
ofcurrentWTOcommitmentsofMemberStatesinthesectorstobeusedinthe
negotiations.
D. PROTECTION FOR KENYA SUGAR INDUSTRY
10. The Authority recalled that at the commencement of the implementation of the COMESA Free
Trade Area in the year 2000, Kenya sought and was granted in 2002 a sugar safeguard as the
country demonstrated that its sugar sector would not be able to compete with sugar from
other COMESA Member States. The safeguard had been extended a number of times since
then with the most recent being an extension of the safeguard from March 2014 to February
2015. The Thirty Second Meeting of Council held in February 2014, extended the Kenya sugar
safeguards by one year and directed Kenya and the Secretariat to undertake a comparative
assessment on the competitiveness of sugar production in the COMESA region. This study was
finalized.
11. The Authority noted that the study found that the COMESA Sugar Safeguards had enabled
the Kenyan sugar milling companies to continue with operations, without which it is unlikely
that all of them would have continued to operate to this day. The safeguards also made it
possible for new investors to enter the Kenyan sugar sector and provided a ready market for
cane farmers which has enabled them continue cane farming as a business and a source of
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6 livelihood. Again, without the safeguard, it would have been difficult for these investors to
enter a market that was flooded with cheaper sugar imports.
12. The Authority further noted that the Kenyan delegation had made a presentation to the
Trade and Customs Committee. It was emphasized that due to the successful use of the
sugar safeguard over the past twelve (12) years, there has been a surge of new investors
in the sugar sector. It was also highlighted that there are potential social and economic
repercussions should the protection of the sugar sector lapse at the end of February 2015,
as there are approximately six million Kenyans who depend on the sector. The duration of
protection sought by Kenya was Three (3) years under article 49(2) on infant industry subject
to concurrence by Member States.
13. The Authority also noted that Council supported the application of the extension of the sugar
safeguard for Kenya, and underscored the importance of having a system that benefits all sugar
exporting Member States especially in terms of promoting intra-COMESA trade. In this regard
the meeting supported the idea of allowing Member States to assist meet the sugar deficit in
Kenya and Kenya expressed its appreciation for the understanding extended by the Member
States.
14. The Authority endorsed the decisions of Council that:
i. TheKenyansugarsectorshouldbegivenaoneyearextensionoftheexistingsafeguard
subjecttoreviewandrenewalforanotheroneyear;and
ii. TheextensionwilloperateonthebasisofthetermsandconditionssetoutinLegal
NoticeNo.1of2007.
E. SCIENCE, TECHNOLOGY AND INNOVATION
2014/15 COMESA Innovations Awards
15. The Authority recalled that the COMESA Innovation Awards was launched in 2013. The
Innovations Awards are aimed at recognizing and celebrating individuals and institutions that
have used science, technology and innovation to further the COMESA regional integration
agenda. The inaugural awards were given out at the 17th Summit of the COMESA Heads of
States and Government held in February 2014 in Kinshasa, DR Congo.
16. The Authority noted the 2014/15 COMESA Innovation Awards are to be given in recognition of
innovations that have the potential for long-term technological or economic impact at national
and regional level. The Categories for the Awards focused on new products, new methods of
production and ways of improving technology as well as the methodology of opening up new
markets, conquest of new sources of supply of raw materials and implementation of new forms
of commercialization, among others.
17. The Authority further noted that a total of sixty (60) submissions were received, and twenty
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(20) were shortlisted and that six candidates were recommended for the Innovation Awards in
their categories and that seven runners up were recommended for certificates of recognition.
18. The Authority also noted that the judging panel had observed that there was an increase in
the spread of submissions, from nine (9) to 13 Member States; and the presentation of the
submissions had improved. However, there was need for improved training for the submissions
to be improved, as well as commitment of more funds for managing the calls for submissions
to the Secretariat. It was noted that country level submissions would assist in improving the
submission process, and that is important to call on the private sector to support and sponsor
the future awards.
19. The Authority:
(i) Congratulatedthewinnersofthe2014/15COMESAInnovationAwards;and
(ii) EndorsedthedecisionsofCouncilthat:
a) ThereportoftheInnovationsAwardsEvaluationPanelbeadoptedandthe2014/15
InnovationsAwardsbegiventothenomineesoutlineinthetableabove;
b) TheMemberStatesshouldrecognizethepotentialcontributionwhichTVwhitespaces
anddatabaseenabledspectrumaccesscanmaketoimprovingspectrumefficiency;
c) COMESAshouldcomeupwithpolicyincentivestoencouragetheutilizationofthe
spectrumthatwillbeavailableduetotheongoingdigitalmigrationtoprovidewireless
broadbandinternettoAcademic,Research,HealthandAgriculturalinstitutionsto
catalyzeinnovations,especiallyintheruralareas;
d) TheSecretariatshouldcoordinateinpartnershipwiththeUbuntuNetAllianceproject
andtheInnovationCouncilthesharingofbestpracticesonthedeploymentofwhite
Innovations Awards are aimed at recognizing and celebrating individuals and institutions that have used science, technology and innovation
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8 spacefollowingtheexamplesofKenya,Malawi,SouthAfrica,Tanzaniathathaverun
successfulWhitespacepilotprograms;and
e) TheSecretariatshouldworkwithstakeholderstodevelopamodelpolicyframework
toguideMemberStatesindevelopinglocalregulationsandpoliciestoenhancethe
utilizationof“whitespaces”.
COMESA Regional Integration University
20. The Authority recalled the decision of the Twenty Eighth Meeting of the COMESA Council
of Ministers that was held in Swaziland on 25-27 August 2010 that proposed the setting
up of a professional or graduate school of regional integration. This decision was based on
the realisation that regional integration is a complex process and to navigate this important
process requires expertise for: policy formulation and analysis; managing the process;
negotiating treaties, protocols and other regulations/policies; understanding the process;
participation in the process - to exploit opportunities; and training/teaching about the process.
21. The Authority observed that the key strategy for a way forward therefore must be in
sustainable capacity building. Research and training institutions to address regional integration
are therefore of absolute necessity. Institutions of higher learning could also contribute to
research work. Institutional capacity building programmes that promote a more inclusive
integration agenda and facilitate knowledge development for the region are urgently required.
Institutions such as the proposed COMESA university are therefore of utmost importance.
22. The Authority noted that a study the establishment of the COMESA University of Regional
integration (COMESA-URI) was completed and that it explored the advantages and
disadvantages of a number of models/approaches for the COMESA-URI .i.e.
a) atraditionaluniversityusingmoderntechnologiestosupplementitsteaching;
b) adual-modeinstitution;
c) apurevirtualuniversity;
d) anewcentralizedandautonomousVirtualUniversity;
e) anetworkofuniversitiesunderanumbrellaVirtualUniversity;and
f) aVirtualUniversityofferingfreecompetitionamongInstitutions.
23. The Authority noted that the study demonstrated that a COMESA Virtual University would be
most advantageous as this would involve setting up a new university with the best practices
learned from mega-universities and other successful universities with the participation of the
best national universities, traditional and non-traditional, and the governments. Each member
would bring financial resources and may bring, after a careful evaluation, some technology,
content and regional centres.
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24. The Authority endorsed the decisions of that the COMESA
Virtual University be established, working with a network of
universities, which will incorporate an Academy of Science,
Technology and Innovation as well as Research Networks.
This virtual university will then progressively transform
into a permanent autonomous University to be launched in
October 2015.
F. CO-OPERATION AMONG MEMBER STATES IN THE MANUFACTURING OF ESSENTIAL DRUGS; AND AMENDMENT OF THE TRIPS AGREEMENT ON COMPULSORY LICENSING FOR MEDICINE
25. The Authority noted that pharmaceutical production in and
for Africa is not only imperative to guarantee access to drugs
and commodities for AIDS and other health challenges on
the continent, but presents an opportunity for Africa to
industrialize. However, Africa is largely dependent (more
than 80 percent) on imported pharmaceutical and medical
products. The need for such drugs presents a potential
market opportunity for African pharmaceutical companies.
26. The Authority noted that local production of pharmaceuticals
can also advance industrial development, reduce external
dependency, facilitate stronger regulatory oversight to curtail
counterfeit products, improve the trade balance and create
jobs. Some38 Member States of the African Union have
some form of pharmaceutical production. Yet the companies
vary in product quality and the ability of the regulatory
authorities to enforce standards. Manufacturers largely rely
on imports for most inputs. The challenges that prevent the
industry from scaling up production include steep investment
requirements; the need for expertise and skilled workers;
....local production of pharmaceuticals can also advance industrial development, reduce external dependency...
stringent quality standards as a prerequisite to access donor funded prequalified markets;
cross-border regulatory harmonization for regional markets; an uneven playing field for locally
produced drugs against finished product imports that are value-added tax–exempt or duty-
exempt; and insufficient access to supportive industries.
27. The Authority also noted the urgency of acceptance by Member States of the Protocol on
Amendment of the TRIPS Agreement, which is open only up to 31 December 2015. This
Protocol, among others, provides developing and least developed countries with large
flexibilities in terms of importing products produced under compulsory licensing from other
countries (Unlike the mandate of Article 31 of the TRIPS).
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i. Identifyandtakeactionsaimedatcreatingaconduciveregulatory,policyand
investmentenvironmentfortheaccess,manufactureanddistributionofAnti-retroviral
andotherdrugsandmedicalcommodities;
ii. SupportthecontinentalandregionaleffortstoendtheepidemicsofAIDS,TBand
Malariaaswellasothercontinentalhealthchallenges;
iii. Holdapharmaceuticalbusinessroundtablewithpharmaceuticalmanufacturers/
associations,policymakersandotherstakeholdersasanentrypointfordeeper
engagementwiththepharmaceuticalindustryonrequirementsforstrengtheninglocal
production;
iv. CreateaCOMESAPharmaceuticalWorkingGrouptoopenalargerpublicprivate
dialogueonencouraginginvestmentsandpartnershipsintheindustry;and
v. ThathavenotyetacceptedtheProtocolamendingtheWTOTRIPSAgreementshould
dosoimmediatelyandnotifytheWTOSecretariat,byDecember2015,afterwhichdate
theacceptancewillbeinvalid.
29. The Authority recalled that COMESA adopted a corridor approach in rolling out the priority
regional infrastructures and identified the major regional corridors in Eastern and Southern
Africa that serve the COMESA member states. These corridors serve the major ports on
the Indian and Atlantic oceans i.e. Durban, Maputo, Beira, Nacala, Mtwara, Dar es Salaam,
Mombasa, Djibouti, Welvis Bay and Lobito whilst a new corridor has been identified and will
serve the Port of Lamu and serve Kenya, Ethiopia and South Sudan. In addition inland maritime
corridors are also being developed i.e. the Lake Tanganyika Transport Corridor, Shire - Zambezi
Waterways Corridor and the Lake Victoria - Mediterranean Sea (VICMED) Navigation Project.
30. In this regard, the Authority also noted that Members States through their implementing
Agencies and support from the Secretariat have been spearheading the implementation of
these priority regional infrastructure projects along these major regional corridors in line with
adopted corridor approach and as a result a lot of progress has been made in fast tracking
the implementation of projects along these corridors. For example, on the North South
Corridor work is on-going work on the detailed engineering design studies and packaging to
bankability in readiness for investments for the rehabilitation of all the road sections that
had deteriorated and were causing serious delays in the transportation of goods and services
along the corridor. With regards to the Djibouti corridor, the Authority is invited to note that
the 750 km Ethiopia-Djibouti standard gauge railway project is 52% complete. The railway
line will eventually connect to Kenya, South Sudan and Sudan through the 1,710km LAPSSET
Railway standard gauge green-field railway line project anchored on Lamu Port on Kenya’s
coastline to Isiolo where it branches to Ethiopia and South Sudan and estimated at a cost of US
$ 7.1 billion. Whilst on the Central Corridor, the Authority is invited to note that the technical
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study for the US$4.0 billion Dar es Salaam - Isaka – Kigali/ Keza - Musongati railway project has
been completed and financial analysis is in progress. Whilst On the Lake Tanganyika Transport
corridor the Lukuga dyke design and engineering had been completed and ADB is funding
design study for Mpulungu and Bujumbura ports in Zambia and Burundi respectively.
31. The Authority endorsed the decisions of Council that:
(i) Djibouti,Ethiopia,SudanandSouthSudanestablishanauthorityforthecorridorand
implementtheOSBPs;and
(ii) theSecretariathastoassistthecountriestoestablishtheauthorityanddevelopthe
legalandregulatoryframeworkfortheOSBPsalongthecorridor;
(iii) theSecretariatshouldconveneameetingfortheDjiboutiCorridorMemberStates;and
(iv) acoordinationmechanismforRiverNiletransport,LakeVictoria,LakeAlbertandLake
TanganyikastudiesincludingNilebasininitiativestudies/projectsbeestablished.
32. The Authority noted that full implementation of Legal Notice No.2 and YD will have positive
impact on the travelling public, air carriers, airports and air navigation service providers, other
allied service providers, tourism and trade and the economy of Member States through job
creation and that air transport can open and connect markets, facilitating trade and enabling
African firms to link into global supply chains.Furthermore, recent reviews of the status of
implementation of the YD by COMESA and AFCAC/IATA have shown that all COMESA member
states are granting 3rd and 4th freedom traffic rights in line with phase 1 of legal notice No 2
and that many member states are also granting 5th Freedom traffic rights as per the provisions
of Phase 2.
33. In order to provide the necessary infrastructure and services that would support the growth
of air transport in a liberalised market, the Authority noted that COMESA, with the financial
support from AfDB to the tune of approximately US$10 million, is implementing COMESA
airspace integration project – the Communications Navigation Surveillance/Air Traffic
Management Systems (CNS/ATM) Project . The project’s main goal is to provide safe, efficient
air navigation services in a unified airspace to support trade, tourism and regional socio-
economic integration in COMESA. The project implementation unit which is hosted by Rwanda
is now fully operational and that international tenders for consultancy services for the project
have been floated and will close at the end of March 2015 and the tender evaluations will
commence in April 2015. The project would be implemented in three years and its expected
outcomes and deliverables are:
a. EstablishmentofaCooperativeLegalandInstitutionalRegionalFrameworkfora
UnifiedSingleUpperAirspaceintheCOMESARegion;
b. EstablishmentofRegulatoryFrameworkandAgencyforCOMESAUnifiedSingleUpper
Airspace;and
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theCOMESARegion.
Cyber Security Programme Implementation
34. The Authority recalled that COMESA adopted the Cyber Security Policy Guidelines and Model
Bill and the Consumer Protection Policy Guidelines and member states have been are using
these COMESA policy guidelines and model bills to update and review their national policies
in order to enhance the ICT sector reform. The Authority is further invited to note that that
the phenomenon of cybercrime affects the entire African continent and the whole world. It
is therefore important for all Member States to jointly fight this vice that is threatening the
region and the world at large. Today a new form of organized cybercrime aimed at financial
gains, with an expansion of the types of threats to various platforms and to various countries.
Moreover, spam has evolved to become a vehicle for delivering more dangerous payloads, such
as the dissemination of viruses, worms and Trojans that are today a means for online financial
fraud, identity or trade-secret theft as well as various other forms of cyber threats.
35. The Authority noted the importance and necessity to implement the cyber security measures
in this fast moving electronic era. It is important to raise the awareness of the cybercrime and
bridge the gaps among Member States. It is therefore imperative to organize a COMESA High
Level Forum on Cyber Security. This will be preceded by an assessment of the current status
of cyber security in the region and prepare an implementation road map to protect COMESA
cyber space. All stake holders involved in combating cybercrime and in particular the security
and judiciary system have to be on board and that a regional agreement on cyber security
needs to be developed and to be signed by Member States to facilitate cooperation and
mutual assistance. The Authority is further invited to note that the full implementation of the
cyber security policy and regulatory framework and Public Key Infrastructure (PKI) will enhance
the public confidence in using effectively use ICTs in socio-economic development. Associated
to and in parallel to the cyber Security programme, The Authority is invited to note that work
is continuing on enhancing the e-government and e-learning and a comprehensive e-services
portal is being developed which will effectively integrate the existing e-government portal and
the e-learning platform. The portal would serve as a one-stop resource for the Member Stated
to use the e-learning platform and find guides and other useful information on e-government.
36. The Authority endorsed the decisions of Council that:
(i) aHighLevelCyberSecurityForumtobeheldin2015;and
(ii) theSecretariatshouldmobiliseresourcesfortheHighLevelCyberSecurityForumand
shouldinviteregionalandinternationalexpertsforexchangeofbestpractices.
Guidelines on the Encouragement of Investment and Utilization of Renewable Energy Sources in the
COMESA Region
37. The noted that the critical shortage of power in the region remains another major constraint to
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economic development. To this end, additional power generation capacity and inter-connected
transmission infrastructure are needed to meet the growing power needs of the region and to
facilitate power trade between countries and cross-border investments
38. In this regard, the Authority noted that COMESA developed the COMESA model energy policy
framework, electric power standards and renewable energy guidelines to facilitate trade
in energy services and create enabling environments for investment power generation and
transmission as well as in renewable energy resources. The enabling environments developed
from 2012 to 2014 include: Interconnection codes and power transmission standards, Baseline
renewable energy database and Report on the Status of accessibility and affordability of
electricity in the COMESA region. COMESA also developed four renewable energy guidelines
in order to facilitate and encourage of investment in and utilization of renewable energy
sources in the COMESA region. The four renewable energy guidelines are: Feed-in-Tariffs
Guidelines (FiT), Power Purchase Agreement (PPA), Public Private Partnerships (PPP) and Joint
Development of Projects.
39. The Authority endorsed the decisions of Council that:
(i) Adoptedthefourrenewableenergyguidelinesi.e.onFeed-in-Tariff(FiT),Power
PurchaseAgreement(PPA),PublicPrivatePartnership(PPP)andJointDevelopmentof
Projects;
(ii) COMESAMemberStatesandmemberinstitutionsbeurgedtousetheseguidelinesin
developingtheirlegalandregulatoryframeworksandatthesametimetocontribute
totheharmonizationofsuchframeworksacrossCOMESAcountries;and
(iii) theCOMESASecretariatshouldfacilitatetrainingprogrammeforMemberStateson
thefourguidelinestofullyunderstandthemandfurtherinternalize/domesticatethem
andthatMemberStatesbeurgedtoavailrelevantinformationfromtheirrespectivecountrieswiththeviewtosharingitwithothers.
Financing Infrastructure Development
40. The Authority noted that estimates on annual investment level currently required by the
Eastern and Southern African region to construct and improve physical infrastructure are in the
order of US$40 billion (covering various priority projects and programmes in roads, railways,
maritime transport, civil aviation, ICT and energy) which have been identified for funding in
order to enhance regional infrastructure networks. The region, therefore, faces a formidable
challenge of financing the development of the infrastructure crucial to promoting growth
and reducing poverty. This calls for urgent and diversified joint mobilisation of financial and
technical resources.
11thEDF Infrastructure Envelope
41. The Authority noted that COMESA, EAC, IGAD, IOC and SADC would be signing the global
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The Authority noted that estimates on annual investment level currently required by the Eastern and Southern African region to construct and improve physical infrastructure are in the order of US$40 billion
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11th EDF Regional Indicative Programme (2016 – 2020) which has a provision of EUR 600
million of grants through a regional infrastructure envelope to support regional infrastructure
development. Access to the 11th EDF regional infrastructure envelope will be through a
leveraging/blending mechanism whereby the EDF money would not be used as grants to fund
total investments need for infrastructure projects as was the case in the previous EDFs but
would be issued to leverage additional funding from European Investment bank and other
donors, development partners and financial markets..
42. The Authority also invited noted that that the EU – AU infrastructure seminar that was held
in October 2013, at the AU headquarters in Addis Ababa, Ethiopia, emphasized the need for
a structured approach in defining the regional pipeline of “bankable” infrastructure projects
inclusive of their state of preparation from identification, prefeasibility, feasibility and detailed
technical design studies, etc., up to ready-for-finance stage. On prioritization of regional
projects, the seminar agreed that the PIDA (Programme for Infrastructure Development in
Africa) system which now features the Africa Infrastructure Database (AID), managed by
NEPAD, and itself encompassing the TRIPDA (COMESA EAC SADC Tripartite Infrastructure
Projects Database) would be considered to be the reference platform for prioritizing the
infrastructure projects.
43. In this regard, the Authority noted that the RECS, party to the11th EDF configuration, namely
COMESA, EAC, IGAD, IOC and SADC, will need to agree, with the European Union through the
High Level Committee (HLC), on a roadmap for the leveraging and blending of the 11th EDF
funding, ahead of the signature of the RIP. In this regard the HLC has agreed on a preliminary
list of priority regional infrastructure projects and programs to be financed through the
infrastructure envelope of the 11th EDF.
44. The Authority noted that under EDF 11 Euro 600 million to be allocated to infrastructure will
be leveraged with financing from the European Investment Bank.
G. COMESA INDUSTRIAL POLICY
45. The Authority noted that in line with the directive of Council that was taken at its meeting
that was held in Kinshasa, DR Congo on 24 February 2014, the Secretariat in consultation with
Member States and COMESA institutions prepared a draft policy on industrial development for
the region. The COMESA Industrial Policy is anchored on key strategic pillars/intervention areas
aimed at diversifying and transforming the economies of Member States in line with the theme
of the COMESA Summit 2015, namely: “Inclusive and Sustainable industrialization”.
46. The Authority noted that the key intervention areas of the policy at both national and regional
level, among others are:
a. Promotionoflinkagesamongindustriesthroughspecializationandvaluechains;
b. Promotionoftheagroindustry;and
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16 c. Promotionofindustrialresearchanddevelopment,transferadaptationand
developmentoftechnology.
47. The Authority endorsed the decisions of Council that adopted the COMESA Industrialization
Policy.
H. AGRICULTURE
COMESA Fertiliser Programme
48. The noted that after the approval of the Joint Fertilizer Procurement Initiative (JFPI) by the
Ministers of Agriculture in September, 2013, COMESA through its specialized agency, ACTESA,
in collaboration with AFAP, has commenced implementation of the fertilizer programme
comprising:
i. TheestablishmentoftheCOMESAFertilizerInvestmentFund;
ii. Provisionofbusinessandtechnicalsupporttofertilizercompaniesandrural
entrepreneurs;
iii. Establishmentofaregionalfertilizerdialogueplatformtofosterpublic-private
partnershipsandbusinesstobusinesslinkagesaswellascatalysingandstrengthening
fertilizermarketinganddistributionsystems;
iv. HarmonisationoffertiliserpoliciesandregulationsintheCOMESAregion;and
v. FertilizerMarketing and distribution programme.
49. The Authority further noted that in order to ensure that the bulk procured fertilizer reaches
the small-holder farmers; ACTESA has come up with a Fertilizer Marketing and Distribution
Programme with the support of the Australian Government Department of Foreign Affairs and
Trade (DFAT). The program seeks to structure and build the capacity of agro dealers, extension
services and other players in the marketing, distribution and use of fertilizer by small scale
farmers at country level.
50. The Authority endorsed the decisions of Council that directed the Secretariat through its
specialized agency ACTESA to:
i. EstablishaFertilizerFinancingFacilitycomprisingasetoffinancialinstruments1to
spurruraltransformationthroughinvestmentsinsmallandmediumenterprises(SMEs)
workingalongthefertilizervaluechain;
ii. Provideatleast500oftheseenterpriseswithAFAPAgribusinessPartnershipContracts
(APCs)thatwillallowforsustainedbusinessandtechnicalsupportoverthenext2-3
yearsinallCOMESAMemberStatesstartingin2015;
1 Financial instruments include: payment and credit guarantees, grants, loans, microcredit, and trade finance, among others.
17
iii. ContinuedevelopingandexpandingtheEasternandSouthernAfricaFertilizerTrade
andInvestmentPlatformfor:(a)sustaineddialoguebetweenthepublicandprivate
sectorregardingkeypolicyandregulatoryissuesaffectingtheperformanceoffertilizer
marketsintheregion;(b)facilitationofregionalfertilizertrade;and(c)increased
privatesectorinvestmentandengagementinthefertilizerindustry;
iv. Establishanextensivenetworkoftrainedandaccreditedagrodealerstoimprovethe
availabilityandaccessibilityoffertilizertosmallholderfarmers(inparticular,women
andyouth)intheregion;
v. EncourageMemberStatestosupporttheimplementationoftheCOMESAfertilizer
policyandregulatoryframeworktofacilitatefertilizertradeandinvestment;and
vi. EncourageMemberStatestoadopttheFertilizerMarketingandDistribution
Programme.
The Malabo Declaration on Accelerated Agricultural Growth and Transformation for Shared
Prosperity and Improved Livelihoods
51. The Authority noted that subsequent to the June 2014 AU Malabo Declaration endorsed by
the African Heads of State and Governments, an Implementation Strategy and Roadmap (IS&R)
has since been developed. The IS&R is aimed at translating the commitments of our African
Leaders into action. The IS&R has two (2) main objectives and eleven (11) strategic action
areas. The Strategy was endorsed at the recent AU Summit held in Addis Ababa, Ethiopia, in
January 2015.
52. A recent review of the CAADP agenda at continental level by various stakeholders, including
development partners and researchers, reveals that although much progress is noted generally
in CAADP implementation since its inception, most African countries have neither reached
the targeted 10% annual budgetary allocation, nor the expected minimum 6% annual sector
growth.
53. Believing in the potential of CAADP as an engine for economic growth and poverty reduction,
Heads of State and Governments of the AU, at Malabo recommitted themselves to advancing
the CAADP agenda with a new target set for 2025. Two (2) Decisions and two (2) Declarations,
directly related to CAADP and Africa’s agricultural transformation and food security agenda for
the decade 2015-2025, were adopted at Malabo.
54. The Authority endorsed the decisions of Council that directed:
i) TheSecretariattosupportMemberStatestoimplementtheMalabo Declaration;
and
ii) TheSecretariattosupportMemberStatestomainstreamtheMalaboDeclaration
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The Authority noted that the Secretariat conducted a skills and capacity building training on gender mainstreaming of over ten (10) member countries
19
ImplementationStrategyandRoadmap(IS&R)intheirexistingNationalAgriculture
Policies,StrategiesandProgrammes.
The Comprehensive Africa Agriculture Development Programme (CAADP) In COMESA
55. The Authority noted the progress made in the implementation of CAADP in COMESA at both
country and regional levels. At country level, 14 Member States have signed their CAADP
Compacts. Of the 14 Member States that have signed CAADP Compacts, 9 have developed
their National Agriculture Investment Plans (NAIPs). At the regional level the CAADP Regional
Compact was signed on the 14th November, 2014, in Kinshasa, DRC. Following the signing of
the Regional Compact, the immediate task is to develop bankable projects.
56. The Authority endorsed the decisions of Council that directed :
i) TheSecretariattosupportMemberStatesintheireffortstomobilizeresourcesforthe
implementationofprogrammesandbankableprojectsinthecontextoftheirNational
AgricultureandFoodSecurityInvestmentPlans;and
ii) TheSecretariattosupportMemberStatesthathavenotdoneso,tocomplete
thedesignandoperationalizationoftheirNationalAgricultureandFoodSecurity
InvestmentPlansandcompletetheprocessofdevelopingtheRegionalAgriculture
InvestmentProgrammesforimplementation.
I. CLIMATE CHANGE PROGRAMME
57. The Authority noted that a total of 9 COMESA-EAC-SADC Tripartite member/partner states
have so far been supported to develop their national Climate Response Policies and Strategies
and these are Botswana, Burundi, Comoros, DRC, Egypt, Kenya, Sudan, Swaziland and
Zimbabwe. Burundi, Ethiopia, Kenya, Rwanda, and Zambia have concluded the development
their National Climate Change Response Strategies (NCCRS). In addition Comoros, DRC, Egypt,
Sudan, and Swaziland are at various stages of NCCRS formulation.
58. The Authority endorsed the decisions of Council that:
i. DirectedtheSecretariattocontinuesupportingmemberstatesinthedevelopmentand
implementationofnationalpolicyandresponsestrategiesonClimateChangeby2016;
and
ii. DecidedthatMemberStatesshouldexpeditenationalprocessessothatthepolicies
andstrategiesonClimateChangecanbeconcludedby2016.
J. GENDER
Gender Mainstreaming in Agriculture and Climate Change
59. The Authority noted that the Secretariat conducted a skills and capacity building training on
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20 gender mainstreaming of over ten (10) member countries, with participants consisting of (a)
UNFCCC Focal Points/Ministry of Environment - custodians of national climate change policies/
strategies/action plans; (b) CAADP Desk Officers in the Ministry of Agriculture; and (c) Planning
officers from ministries responsible for planning. The training was conducted to support the
development of Country Proposals for Climate Finance Readiness Activities in the Eastern and
Southern Africa region, in order to access funding under the AfDB’s Africa Climate Change
Fund.
60. The Authority further noted that the Secretariat documented at least three case studies on
Climate Smart Agriculture (CSA) best practices from Africa with strong gender dimensions in,
Malawi, Ethiopia and Kenya in August and September, 2014. In Ethiopia, the case study was
on the sustainable land management programme implemented by Ministry of Agriculture,
and in Malawi on Conservation Agriculture, implemented by the Ministry of Agriculture, in
partnership with Total Land Care (TLC). The documentaries are part of the “Africa Rising”
initiative by the African Union.
61. The Authority also noted that in order to advance the implementation of the CAADP National
Agriculture Investment Plans and address gender issues in agriculture, COMESA is working on
developing a “Regional Framework” to enhance gender inclusion in the CAADP implementation
processes. The proposed Regional Framework aims at institutionalizing and consolidating
Gender within the CAADP implementation functions (policy, frameworks, regulations,
implementation, and monitoring and evaluation plans) for improved role of women and youth
in agricultural productivity.
62. The Authority endorsed the decisions of Council that:
i. MemberStatesshouldstrengthenthecapacityofgenderexpertstocontributetothe
entireCAADPprocess;
ii. TheSecretariatandMemberStatesshouldincorporategendersensitiveplanninginall
interventionsonclimatechangemitigationandadaptationatregionalandnational
levels;and
iii. TheSecretariatandMemberStatesshouldsupport(a)trainingandawareness-raising
forfemaleandmaledelegatesonissuesrelatedtogenderbalanceandclimatechange,
and(b)buildingtheskillsandcapacityoffemaledelegatestoeffectivelyparticipatein
theUnitedNationsFramework Convention on Climate Change (UNFCCC) meetings.
COMESA Youth Programme and Youth Pilot Projects
63. The Authority noted that the Ministers of Gender adopted the COMESA Youth Programme
and Youth Pilot Projects. The program and pilot projects cover: Youth Employment; Youth and
Environmental Management for Income Generation; and Character and Creativity Initiative.
The authority is also invited to not that a consensus was reached that both Secretariat and
MS were responsible to replicate pilot projects whilst the Member States were responsible for
21
internship programs.
64. The Authority endorsed the decisions of Council that:
i. AdoptedtheYouthProgramme;and
ii. Directedthethat:
a) Secretariatshouldensurethatstrategicpriorities,outcomesandoutputsinclude
specialmeasuresongenderfortheidentifiedgapsintheYouthProgramme;
b) Secretariatshouldincludetheaspectof“internship”underemploymentand
mentorshipunderentrepreneurshipinthedesignedYouthProgramme;
c) SecretariatshouldreplicatethepilotprojectsinotherMemberStates;and
d) ReplicationoftheyouthpilotprojectswillbetheresponsibilityofbothCOMESA
SecretariatandMemberStates,whiletheaspectofinternshipwillbetheresponsibility
ofMS.
K. STATUS OF SIGNATURE, RATIFICATION AND DOMESTICATION OF COMESA LEGAL INSTRUMENTS
65. The Authority recalled that the effective implementation of the COMESA Integration
Agenda depends on the entry into force of COMESA Legal Instruments and ultimately the
domestication at the national level of those instruments by member States. Monitoring and
Evaluation of the past years show that one of the challenges that face COMESA today is relating
to programs is lack of domestication of legal instruments at the national level. It is therefore
important that member States be urged to sign, ratify and domesticate legal instruments that
have not yet been domesticated. To this effect, Member States should be urged to work with
the Secretariat to sign, ratify and domesticate legal instruments. Member states can access
technical and related financial support from the Secretariat.
L. STATUS OF FINANCING OF COMESA PROGRAMMES
66. The Authority recalled that Chapter thirty of the COMESA Treaty provides for Financial
Provisions which are elaborated in Articles 166 and 167. With regards to resources of the
budget, sub paragraph 4 of Article 166 states that; “the resources for the budget shall be
derived from annual contributions of the member States and such other sources as may be
determined by Council. The contributions of the Member States shall be based on the budget
as approved by Council”.
67. The Authority further recalled that Article 168 of the Treaty on the Common Market Levy and
Other Resources provides that:
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22 i) “ThereisherebyinstitutedaCommonMarketlevyforthepurposeofgenerating
resourcesforfinancingCommonMarketactivities;
ii) Thesource,levelandconditionsforapplicationsoftheCommonMarketlevyshallbe
determinedbyCouncil;
iii) OtherresourcesoftheSecretariatshallincludesuchextra-budgetaryresourcesas:
a. Grants,donations,fundsforProjectsandProgrammesandtechnicalassistance;and
b. IncomeearnedfromactivitiesundertakenbytheCommonMarket.”
68. The Authority noted that at previous meetings both Council and the Authority has called
upon the Secretariat to explore alternative means of financing COMESA regional integration
programs with a view to reducing donor dependence and to ensuring ownership and
sustainability in financing. Indeed, over the years, the Secretariat has undertaken several
studies which came up with specific recommendations on measures and modalities required
for the implementation of the Treaty provisions as cited above, under which Member States
established specific funds.
69. The Authority noted the assessed budget contributions by Member States to the regular
budget of the COMESA Secretariat for the years 2010 to 2014 and the contribution by
development partners to the COMESA budget for the same period. The Authority further noted
that a comparison of the funding by Member States and Development Partners showed that
annually on average for every one (1) United States Dollar of funding contributed by Member
States, Development Partners provide four (4) United States Dollars. This underlined the
need for Member States to provide counterpart finding for programs funded by Development
Partners to ensure ownership and sustainability.
70. The Authority also noted that a comparison of the funding status of the other sister RECs i.e.
EAC and SADC for 2012/2013 budgets indicated that, notwithstanding COMESA having more
Member States than the other two RECS, its budget contributed by Member States is the
lowest, standing at 41.5% and 42% to that of the EAC and SADC respectively.
71. The Authority further noted the financial contribution to the COMESA regional integration
programmes by the COMESA institutions that were established pursuant to the Treaty
provisions. The Authority then observed that, whereas the institutional architecture exists
for COMESA countries to collectively mobilize resources necessary for the financing of
programs, the inability to agree on the modalities of implementing the Common Market Levy
as provide for in Article 168 of the Treaty continues to limit the benefits of regional integration
from pooling resources. Several studies undertaken by the Secretariat have shown that the
implementation of such a levy on imports from third countries on selected goods would
generate revenues in excess of one (1) billion United States Dollars annually for the COMESA
Fund. This amount would be more than the development assistance that cooperating partners
provide to COMESA in a period of six years. ECOWAS provides a lesson to COMESA in that the
23
ECOWAS levy on imports from third countries generates approximately US $1.2 billion annually.
72. Taking into account that COMESA member States had agreed in principle on the establishment
of a Common Market levy and that several studies had demonstrated the viability of the levy,
the Authority observed that was required was a political decision to translate the commitment
made by Member States into concrete action.
Decision:
73. The Authority decided that:
(i) inordertoimplementtheCommonMarketLevy,aMinisterialTaskForceofMinistersof
FinancefromsevenmemberStatesbeestablishedtoamongothersreviewallprevious
studiesandrecommendthemostappropriatelevyonspecificgoodswhichshouldbe
implementedbyMemberStatesthatareinapositiontodoso;
(ii) TheministerialTaskforcewouldbesupportedbyateamofhighlevelexpertson
taxationwhowillbefreetoco-optexpertsfromdevelopmentfinanceinstitutionsfrom
withinandoutsidetheregion;and
(iii) TheTaskForcewouldbesupportedandfacilitatedbytheSecretariatandwouldbe
requestedtocompletetheassignmentby30October,2015andthiswouldinvolve
consultationswithMemberStates.
M. PROGRESS REPORTS OF THE COMESA INSTITUTIONS
74 . The Authority noted and welcomed the Reports of the COMESA institutions which outline the
status of implementation of their programs in support of the COMESA Integration Agenda.
COMESA Court of Justice
75. The Authority noted that the inauguration of the Court took place on 05 March 2015 in
Khartoum, Sudan at a colourful ceremony that was presided over by the Vice President of the
Republic of Sudan, His Excellency Dr Hassabo Mohammed Abd El-Rahman. Also in attendance
were various Ministers and delegates from the Ministries of Justice and Attorneys-General of
several Member States. The Honourable the Judge President of the Court, Mr Justice Nzamba
Kitonga and other Honourable Judges of the Court were also in attendance, as well as the
Secretary-General of COMESA, Mr Sindiso Ngwenya.
76. The Authority is also noted that the Judge President, Justice Nzamba Kitonga, thanked the
Government of the Republic of Sudan for putting up the Court building and its continued
support to the Court as it settles down in its permanent seat. Further, since this was his last
appearance before the Intergovernmental Committee following the expiry of his tenure of
office, he thanked the Member States and the Secretariat for the support rendered to him over
the last ten years when he was heading the COMESA Court of Justice.
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24
77. The Authority endorsed the decisions Council that:
i. CommendedtheGovernmentoftheRepublicofSudanforputtingupandfurnishingthe
CourtbuildingworthUS$5million,andfororganizingasuccessfulinaugurationofthe
Court;
ii. UrgedMemberStatestocontinuepayingtheirassessedcontributionsontime,in
accordancewithArticle42(4)and166(6)oftheCOMESATreatytoenabletheCourt
achieveitsobjectives;and
iii. CommendedJusticeNzambaKitongaforhisdedicatedservicetotheCOMESACourtof
Justiceoverthelasttenyears.
COMESA Leather and Leather Products Institute (LLPI)
78. The Authority recalled that during the COMESA Heads of State Summit held in DRC on 26-
27 February 2014, COMESA/LLPI was directed to assist Member States to formulate national
leather value chain strategies aligned with the regional strategy. The principal objective was
to revitalise the regional leather sector by enhancing value addition at Member State level.
To achieve this, LLPI adopted the Triple Helix Approach as mechanism of building strong and
closer collaboration linkages that would facilitate a sustainable development of the leather
value chain in the region and designed eight (8) strategies through a holistic participatory
process of value chain stakeholders anchored on the Triple Helix methodology. In order to
legitimise and give a formal meaning to these new relationships, COMESA/LLPI was proactive
HonourabletheJudgePresidentoftheCourt,MrJusticeNzambaKitonga
25
and signed MoUs with chambers of commerce, universities and leather associations in
pursuing the critical aspect of incubating technology transfers and sustained capacity building
initiative
79. The Authority noted that Council commended the LLPI for its efforts in SME and value chain
development in the leather sector in the region, and urged the institution to tap into the
industrial policy. The meeting also noted that LLPI commended the PTA Bank for the financial
support to LLPI.
The Eastern and Southern African Trade and Development (PTA) Bank
80. The Authority noted that the PTA Bank currently had 28 shareholders: 18 African sovereigns
from COMESA, EAC and SADC, eight (8) institutional investors and that as at 31 December
2014, the Bank’s balance sheet had risen by 42% to US $3.5 billion, reflecting another record
increase in the volume of financing to Member States, spread across various sectors and
countries. As a result the Bank’s profitability has continued to strengthen while its financial
position and capacity to attract greater funding in support of expanded financing activities has
improved further.
81. The Authority also noted that the PTA Bank was rated by two international rating agencies,
namely: Fitch and Moody’s. In 2012, Fitch Ratings revised the Bank’s outlook from stable to
positive and, in 2013upgraded the international long term rating from BB- to BB with a stable
outlook. In October 2014, Fitch re-affirmed the upgraded rating of BB, with a stable outlook while
Moody’s maintained its Ba1 rating. Both rating agencies cited the Bank’s expanding capital base
and strong liquidity among the critical strengths taken into consideration.
82. The Authority recalled that the COMESA Infrastructure Fund (CIF) was launched in 2010 to invest
in infrastructure projects in Member States and that the CIF is hosted at the PTA bank. The CIF
set out to attract investments from COMESA sovereigns and institutions as well as multilaterals,
private and public enterprises. The Fund’s target is to raise US $1 billion in tranches, with the first
tranche of US $200-250 million expected to close in mid-2016. The following are some of the
milestones achieved so far in the course of the implementation of the CIF:
i. TheBankhasestablishedanofficeinMauritiuswheretheCIFishosted;
ii. CIFfundsheldbyCOMESAhavebeentransferredtotheFund’saccount;
iii. ServiceproviderswereselectedandapprovedbytheCIFInterimAdvisoryBoard;
iv. TheChiefExecutiveOfficeroftheFundwasappointed;
v. TheBoardoftheBankapprovedtheseedcapitalinvestmentofUS$15million;and
vi. Privilegesandimmunitiesprotocolswerenegotiatedwiththehostgovernment.
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26 83. The Authority endorsed the decisions of Council that:
i. CommendedthePTABankforcontinuedfinancingtoinfrastructureandother
developmentprojectsintheregion;and
ii. EncouragedallAfricansovereignandinstitutionalshareholderstocontinueto
demonstratecommitmentintheBank.
The PTA Reinsurance Company (ZEP-RE)
84. The Authority recalled that the PTA Reinsurance Company (ZEP-RE) is mandated to promote and
develop the insurance industry of the region through re-insurance business. The key objectives of
the company include: fostering the development of the insurance and reinsurance industry in the
region; promoting the growth of national, sub-regional and regional underwriting and retention
capacities, ultimately supporting regional economic development.
85. The Authority noted that ZEP-RE currently had 36 shareholders comprising; six (6) governments,
ten (10) government owned insurance and reinsurance companies, 16 private companies, two
(2) COMESA institutions (the COMESA Secretariat and the PTA Bank); and two (2) development
finance institutions. As of end December 2013, ZEP-RE recorded a 22% growth in business
underwritten, from US $81.7 million in 2012 to US $100.2 million in 2013. It also achieved an
underwriting profit of US $8.4 million and an overall profit of US $15.4 million. There was a
34% and 30% growth in its shareholder funds and total assets respectively.
COMESA Regional Investment Agency (RIA)
86. The Authority noted that since its launch, COMESA Regional Investment Agency (RIA) has been
active in promoting the COMESA region as a Common Investment Area, building a positive image
of the region to investors worldwide, and improving Member States’ ability to attract Foreign
Direct Investments (FDI) into their countries. More specifically, COMESA RIA has been able to
contribute to the improvement of Member States’ investment and business climates through
various capacity building programmes targeting mainly the regions’ investment promotion
agencies. The RIA programme activities included: training on various topics related to investment
promotion, development of websites and investors’ tracking systems, development of various
publications and the completion of in-depth studies. The direct outcome of these activities has
been the strengthening of the capacities of the investment promotion agencies to promote their
respective countries to attract new investment and retain the existing investment base.
87. The Authority also noted that in addition to the capacity building programs, in 2014 RIA
undertook many investment promotional activities. For example RIA organised High-level
international COMESA investment forums and Ministerial Road Shows; participated at key
international investment events and gave support to Member States’ investment events;
developed of an regional Investor Portal that is now attracting over 150,000 visitors annually;
published various country-level and regional investors’ guides and other promotional tools. RIA
27
RIA organised High-level international COM
ESA investment forum
s and M
inisterial Road Shows; participated at key international investm
ent events and gave support to M
ember States’
investment events
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28 was also involved in the promotion of specific investment opportunities and projects as well
as the dissemination of positive news and information about facilities, regulatory frameworks,
incentives, and procedures. These promotional efforts have succeeded in bridging the gap
between perceptions and reality. They have also raised the profile and image of the region and
it’s Member States as an investment friendly region with higher Returns on Investment than
anywhere else in the world.
African Trade Insurance (ATI)
88. The Authority noted that the African Trade Insurance Agency (ATI) has continued to fill a
market gap and boost investor confidence not only in the COMESA region but across the
African continent. Demand for political and credit risk insurance continues to grow as investors,
suppliers, contractors and exporters and, in particular their funding banks are looking for ATI to
offer reliable financial solutions to cover their political, sovereign and credit risks.
89. The Authority also noted that the ATI offers guarantees for trade and investment projects in
virtually all sectors of the economy, including in energy, mining, oil, manufacturing and road
infrastructure and telecommunications sectors. A key milestone was the payment of some very
large claims for example the sovereign default on infrastructure contracts and physical damage
loss resulting from the Westgate mall terrorist attack in Kenya. In 2014 ATI posted positive
records in key performance areas and made significant improvement in its operational processes,
while concluding new strategic partnerships. Over the last five years, the Agency facilitated trade
transactions and investment projects worth over US $16 billion.
90. The Authority noted that Country membership expansion within and outside the African region
remains a key priority for ATI’s growth and development strategy. The Agency’s growth strategy,
which aims at expanding the institution’s reach, places ATI in an ideal position to achieve
even greater results in the years to come. In this regard, the ECOWAS Council of Ministers
resolved to request all ECOWAS Member States to join ATI. ATI Management and the ECOWAS
Commission have embarked on a membership drive that will see all the ECOWAS Member
States take up membership in ATI. This development would no doubt facilitate the attainment
of the Continental Free Trade Area.
91. The Authority endorsed the decision of Council that:
i. MemberStatesthatarenotyetmembersofATIshouldjointheinstitution;andtonote
that
ii. Fifteen(15)ECOWASMemberStateshavedecidedtojoinATI.
COMESA Business Council (CBC)
92. The Authority recalled that the establishment of COMESA Business Council (CBC) is mandated
by the COMESA Treaty as the consultative committee of the business community and other
interested parties. The CBC is currently supported by key development partners – United States
29
Agency for International Development (USAID), International Trade Centre (ITC) Investment
Climate Facility (ICF) and the private sector which forms the CBC’s business membership. The
CBC has grown substantially over the years and during 2014 CBC achieved the following results,
among others:
a. EstablishedadedicatedinstitutionforSMEsatacentralgovernmentlevel;
b. EstablishedacustomizedSMEfundtoprovidefinanceforSMEsataregionallevel;
c. AcceleratedtheimplementationoftheCOMESABusinessVisa;
d. PromotedauthenticAfricanproducts;
e. Facilitated12companylinkagesintheregion,ofwhichsevennewcompanieshave
beenregisteredinCOMESAMemberStatesinpartnershipwithinternationalinvestors;
and
f. Facilitatedthelinkagesof45SMEcompaniesinAfricatoparticipateintheAfricaSME
competitionawards.
93. The Authority noted that CBC organised the 10th COMESA Business Dialogue that ran
concurrently with the current COMESA Policy Organs Meetings. The Dialogue focused on
combating challenges of illicit trade and reviewing public-private collaboration to curb illicit
trade in the region. It is estimated over US $330 million is lost annually on counterfeit products
in the COMESA region alone. The issues of illicit trade are compounded by issues such as
porous borders, corruption, high tax regimes, poor transit controls and illegal distribution
networks. The outcomes of the 10th COMESA Business Dialogue
94. The Authority endorsed the decisions of Council that urged Member States to:
i. Developacommonpublic-privateactionontheon-goingdetrimentstoindustryasa
resultofillicittrade;
ii. Supporton-goingconsultationsonthedevelopmentofthe“MadeinCOMESA”label;
iii. Partnerwithandsupporttheprivatesectorintheon-goingdeliberationsonaRegional
FrameworkoncurbingillicittradeinCOMESA;
iv. Setupdedicatedqualitymanagementandcontrolbodiesthatcanprovidefreeor
subsidizedcosttrainingprogrammesonstandardsandcertificationthatwillboostthe
competitivenessofSMEs;
v. Considerthatsuchinstitutionsbesetuponthepublic-privatepartnershipagenda;
vi. EngagetheRECSecretariatstofacilitatetheparticipationoftheprivatesectorwithin
thenationaldelegationandregionalbusinesscouncilstructures;and
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30 g. Haveanagendaitemthatopenstheflowforadvocacyoftheprivatesectorwithinthe
Tripartitenegotiationprocesses.
COMESA Federation of Women in Business (FEMCOM)
95. The Authority noted that in 2014 the FEMCOM Secretariat continued to promote value
addition by supporting the formation of national and regional clusters in agro processing,
cassava and the textiles and garments sectors- as a vehicle for boosting job creation, intra-
regional trade and contributing to the achievement of the Millennium Development Goals
(MDGs), especially MDG Goal One on the eradication of extreme poverty and hunger. FEMCOM
is also implementing the COMESA Business Incubator for African Women Entrepreneurs
(BIAWE) Project that is aimed at supporting women entrepreneurs in Africa through upgrading
and building capacities of business incubator(s).
96. The Authority noted that Government of Malawi, as host of FEMCOM, is committed to
continually support FEMCOM and has offered ten (10) acres of land in Lilongwe, Malawi for the
construction of FEMCOM Head Quarters. The Authority is further invited to note the need for
the construction of the FEMCOM HQ to start in earnest given that the land was donated over
three years ago.
97. The Authority endorsed the decisions of Council that:
i. TheGovernmentofMalawishouldbecommendedforgiving10acresoflandforthe
developmentofFEMCOMcomplexandforprovidingofficespaceforFEMCOM;
ii. TheSecretariatshouldmobilisefundsforFEMCOMactivities;and
iii. UrgedMemberStatestocontributefundsfortheprogrammeactivitiesofFEMCOM.
COMESA Competition Commission (CCC)
98. The Authority noted that the COMESA Competition Commission Council has developed a 2015
Work Program that is based on five (4) pillars namely competition enforcement, competition
advocacy, institutional coordination, technical assistance and capacity building. The work
program pillars involve the following:
a. Competitionenforcement:thisdealswiththeassessmentofmergersandacquisitions,
investigationofanticompetitivebusinesspracticesandinvestigationsofconsumer
welfareviolationswithintheCommonMarket;
b. Competitionadvocacy:thisrelatestocreatingawarenesstogovernments,businesses,
consumersandotherstakeholderstoappreciatethebenefitsoftheregional
competitionenforcementregime;
c. Institutionalcoordination:thisinvolvesenhancingtheworkingrelationshipwiththe
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nationalcompetitionauthoritiesoftheMemberStatesintheenforcementofthe
RegulationsatMemberStateslevel.Thisalsoinvolvesengagedfirmsininstituting
anenforcementregimethatcontributestoeasingthecostofdoingbusinessinthe
CommonMarket;and
d. Technicalassistanceandcapacitybuilding:thisdealswiththeprovisionofexpertise
toMemberStatestoinitiate,establishandenhancetheimplementationandthe
enforcementoftheirrespectivecompetitionlawsintherespectivecountries.Thisalso
involvescapacitybuildingofthenationalcompetitionagenciesthroughtraining,staff
exchangeprogrammeandfundingsupport.
99. The Authority noted that the Commission has continued to facilitate huge investments
business in the COMESA region through acquisitions and mergers and that since December
2014, the Commission has:
a. Receivedthree(3)mergernotifications.Inaddition,theCommission’sCommitteeof
InitialDeterminationsattwiceinMarch2015andclearedfive(5)mergersandother
formsofacquisitionswhichwerenotifiedtotheCommissioninlate2014.
b. Cognisantofthestakeholders’feedbackregardingitsoperationsandinorderto
streamlineitsoperations,theCommissionhasrecommendedsomeamendmentstothe
RulesontheMergerFilingFeesaswellastheRulesonMergerNotificationThresholds.
TherecommendationswerepresentedtothelegaldraftingcommitteeinJanuary2015
andwereapprovedbytheCommitteeoftheMinistersofJusticeandAttorneys-General
attheirmeetinginSudaninMarch2015.
c. IntensifieditsadvocacyworkinMemberStatesandconvenedasensitisationand
awarenessseminarinEgypton18March2015.Theseminarattractedtheparticipation
ofover70membersofthelawsocietyandthebusinesscommunityfromtheCOMESA
region.
d. Undertook,incollaborationwiththeUnitedNationsConferenceonTradeand
Development(UNCTAD),apeerreviewoftheCompetitionandTariffCommission
(CTC)ofZimbabweandprovidedtrainingtotheBoardMembersandstaffofthe
CTC,toenhancetheireffectivenessintheenforcementofthenationalandregional
competitionlaw,inFebruary2015.
100. However, the Authority noted that the Commission still faced challenges in its enforcement work due to the lack of domestication of the COMESA Treaty and the Competition Regulations by the Member States. Domestication is critical for the effective enforcement of the regional competition legislation in the respective jurisdictions of the Member States, as well as the attainment of the regional integration agenda.
101. The Authority noted that the COMESA Competition Commission since it began operations in January 2013 has handled mergers and acquisitions of US$58 billion confirming that the
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102. The Authority endorsed the decisions of Council that urged:
i. MemberStateswithoutnationalcompetitionlegislationsnamelyComoros,Democratic
RepublicofCongo,Eritrea,LibyaandUgandatocomeupwiththerespectivenational
competitionlegislation;
ii. MemberStatestoimplementtheKinshasadecisionsexpeditiously;and
iii. Burundi,Comoros,Djibouti,DRCongo,Eritrea,Libya,Madagascar,Mauritius,Rwanda,
SudanandUgandatocommunicatetheiraccountnumberstoenabletheCompetition
Commissionpaytheirrespectiveshareofthemergerfilingfees.
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